A new report from ReportsnReports.com estimates that small cells and carrier Wi-Fi deployments will account for nearly $352 billion in mobile data service revenues by the end of 2020.

According to findings, the rapid growth of small cells and carrier Wi-Fi is driven by the in-building wireless coverage requirements and the growing influx of mobile broadband data traffic, which means operators need to have more capacity on radio access networks.

Traditional macrocell-based cellular network deployments are not able to support today’s coverage and capacity needs. As a result, wireless carriers are exploring options such as strategically deployed small cells and Wi-Fi access points to offload additional coverage and capacity.  

This in turn has led analysts to estimate that small cells, carrier Wi-Fi, DAS and cloud RAN infrastructure investments will account for a $42 billion HetNet ecosystem by 2020.

Over 150 global wireless carriers have already deployed small cells and carrier Wi-Fi in their networks. Alternate deployments such as Distributed Antenna Systems (DAS) and the emerging Cloud Radio Access Networks (RAN) architecture further add to the heterogeneity of the networks.

The report added that small cells and carrier Wi-Fi deployments are expected to carry more than 60 percent of all mobile network data traffic by 2020, which will account for $352 billion in mobile data service revenue. And the demand for small cell backhauling has opened a new opportunity for investment, which will be a market worth nearly $6 billion by 2020.

The small cells and carrier Wi-Fi infrastructure value chain is highly fragmented with ‘pure-play’ and incumbent macrocell vendors that are competing to gain a greater share of the market.

SNS Research expects the small cells value chain to consolidate over the coming years following several future acquisitions such as the recent takeover of Ubiquisys by Cisco (News - Alert).  Considering the rapid growth in small cell deployments, several DAS vendors (such as BTI Wireless) are entering the small cell market as well.